Renting should not always be seen as such a bad alternative

WELCOME to generation rent, a land where the great British dream of owning your own home has become a nightmare.

New figures prove beyond doubt what many of us have known for some time: that more and more people are simply unable to get on the home ownership ladder.

Increasing numbers are opting to rent and forecasts are that this will go on rising in the years ahead.

But is that really a bad thing? Home ownership has become a national obsession over the last 50 years, while our European cousins have been quite happy to rent rather than buy.

This is Britain, however, and property is seen as long-term security. Renting is for students, isn’t it?

The answer is not any more. Many young people haven’t got a prayer of raising a decent deposit without parental help. And those parents face their own pressures, with falls in their standard of living and uncertainty over the cost of elderly care looming over them.

To quote Lionel Bart’s lyric: Fings Ain’t Wot They Used T’Be.

The hard fact is that they may never be the same again in the housing market.

Comments (2)

Renting is popular in mainland Europe because there tenants have robust protection under the law. Here you can be thrown out with two months notice - onto this nightmare of a housing market - if the landlord so much as wants to sell the property.

Renting is popular in mainland Europe because there tenants have robust protection under the law. Here you can be thrown out with two months notice - onto this nightmare of a housing market - if the landlord so much as wants to sell the property.oxfordcompsci

If you consider that buy-to-let gross rental returns, before any agency and maintenance costs, in much of Oxford are below 3% then buying is really only better if you assume that a) interest rates (the main costs of owning) stay where they are and b) new build housing does not take off, so supply remains restricted. These two things are driving up house prices and without prices going up owning a house is simply a losing game, because net rental returns are already negative. The (local) Tories seem hellbent on maintaining supply restrictions, but interest rates will be going up over the next few years. What will happen to those ludicrous prices then? Buying a house now is like placing a bet on black: It may pay off, but you could just as easily lose everything.

If you consider that buy-to-let gross rental returns, before any agency and maintenance costs, in much of Oxford are below 3% then buying is really only better if you assume that a) interest rates (the main costs of owning) stay where they are and b) new build housing does not take off, so supply remains restricted. These two things are driving up house prices and without prices going up owning a house is simply a losing game, because net rental returns are already negative. The (local) Tories seem hellbent on maintaining supply restrictions, but interest rates will be going up over the next few years. What will happen to those ludicrous prices then? Buying a house now is like placing a bet on black: It may pay off, but you could just as easily lose everything.train passenger